Once again, we see those who love to rhapsodize about the purity of the free markets working to disrupt and distort the free market with subsidies. Donald Shaw of The Lever reports on political initiatives to make divestment of fossil fuel companies illegal.
Republican state and federal lawmakers, their campaign coffers filled with fossil fuel donations, are quietly building a nationwide effort to pass anti-divestment bills that would punish financial institutions that consider the climate crisis in their business deals or try to do something about it by not working with fossil fuel companies.
The effort began last December, when a model bill written by former Texas state Rep. Jason Isaac (R), now director at the Charles Koch-funded think tank Texas Public Policy Foundation, was unveiled at theAmerican Legislative Exchange Council’s major gathering of conservative lawmakers. The model legislation, titled the “Energy Discrimination Elimination Act,” calls for states to identify and divest from financial institutions that boycott or otherwise penalize energy companies for falling short of environmental standards.
Since then, several states have introduced bills based on the model language, with two versions already becoming law. The push has also made its way to the national level. A federal bill proposed last month by the U.S. House’s top recipient of coal industry money would prohibit financial advisers from considering ESG — environmental, social, and corporate governance — factors when making investment decisions.
Now the fight against ESG considerations is spilling out of the halls of Congress and state legislatures. Last week, Utah’s Republican governor and its entire congressional delegation sent a letter to the credit rating agency S&P Global Ratings opposing the company’s plans to add ESG scores to its global credit ratings for state and local governments.